Is a Typo Responsible for Yesterday’s Stock-Market Crash?

The Dow Jones plummeted nearly 1,000 points for a brief period of time yesterday afternoon. The Wall Street Journal is calling it a “Flash Crash,” which is adorable, frankly. Today, financial coroners have released the results of their autopsy: the market, already down 400 points likely because of Greece’s terrifying debt-’n-riots ordeal, took a turn for total (momentary!) catastrophe following some sort of trading error. During the free fall, Procter & Gamble’s stock experienced a 37 percent decline, dropping from $60 a share to just $40; there were also precipitous declines for Apple, Accenture, and Oxford Industries, according to CNNMoney.com. Some stocks fell to as little as a penny. As for the nature of the mysterious erroneous trade, CNBC reported that a trader might have indicated “billion” with a “b” instead of “millions” with an “m” during a P&G-related transaction. This is the stuff that would cruelly elude spell-check, and it affect5s us all every day.

The media is calling it a “fat finger” error. (But how fat can a finger be if it not only entirely misses the “m,” but also overshoots the “n” that lies between “m” and “b”? Are giants running our markets?) A skeptical panic of sorts ensued: According to CNN (via the Huffington Post), following the Great P&G Typo of 2010, “the stock exchanges were allowed to report P&G's stock price on their own, instead of getting the price from NYSE. According to the company and NYSE, the Nasdaq stock exchange misprinted a quote of $39.37 a share, even though the stock was really trading at $56.” When the market closed, the Dow was “only” down 347 points. Hooray?